Average Car Insurance Cost and the Factors Affecting It

Average Car Insurance Cost: The national average cost of car insurance is $1,621 per year. Although this can vary, depending on some individual factors, factors ranging from; your age, state, gender, vehicle type, credit score, accident history, and so on.

Average Car Insurance Cost and the Factors Affecting It

For example, if you are 16 years old and getting insurance on your own, car insurance will cost a whopping $8,226 a year. But at age 45, you’ll pay just $1,929 per year for the same insurance.

So, this brings us to the main question. How much exactly is average cost of car insurance, when considering each of these factors? On this article; to each factors I will be highlighting each of their cost.

Average Car Insurance Cost

Each factor affecting the average car insurance cost has a range, and I will be highlighting all of it in detail.

Company

The cost of car insurance can vary from carrier to carrier. Below are the list of available company with their car insurance cost.

Insurance Provider Average Annual Premium
Allstate $4,370
Esurance $2,558
Farmers $3,448
Geico $3,240
Liberty Mutual $4,542
Nationwide $3,178
Progressive $2,962
State Farm $2,376
USAA $2,102

State

The average annual premium fluctuates from state to state and even from zip code to zip code. Premiums are affected by local factors including the amount of traffic in the area and crime/theft rate.

State Average Annual Premium
Alabama $1,387
Alaska $1,198
Arizona $1,295
Arkansas $1,496
California $1,815
Colorado $1,682
Connecticut $1,550
Delaware $1,828
Florida $1,496
Georgia $2,059
Hawaii $1,547
Idaho $1,081
Illinois $1,018
Indiana $1,222
Iowa $1,150
Kansas $988
Kentucky $1,476
Louisiana $1,898
Maine $2,339
Maryland $896
Massachusetts $1,327
Michigan $1,277
Minnesota $2,693
Mississippi $1,288
Missouri $1,537
Montana $1,410
Nebraska $1,387
Nevada $1,284
New Hampshire $1,915
New Jersey $1,105
New Mexico $1,671
New York $1,352
North Carolina $1,688
North Dakota $947
Ohio $1,325
Oklahoma $1,032
Oregon $1,560
Pennsylvania $1,393
Rhode Island $1,390
South Carolina $2,110
South Dakota $1,369
Tennessee $1,342
Texas $1,427
Utah $1,827
Vermont $1,209
Virginia $1,075
Washington $918
West Virginia $1,205
Wisconsin $1,420
Wyoming $1,070

Coverage Level

Depending on your level of coverage, your premium will vary. If you’re leasing or financing your vehicle, you might be required to carry gap insurance as well. Below are some average auto insurance rates based on your coverage level across the US.

Coverages 6-Month Premium Monthly Premium
State Minimum $302 $50
50/100/50 BI/PD $350 $58
100/300/100 BI/PD $398 $66
State Min with 1000 Comp/Coll DED $607 $101
50/100/50 BI/PD with 1000 Comp/Coll DED $653 $109
100/300/100 BI/PD with 1000 Comp/Coll DED $700 $117
State Min with 500 Comp/Coll DED $689 $115

Age

Age is a major component of auto insurance premiums. It is a reliable indicator of how risky a driver you will be to your insurance company. In fact, every year you celebrate a birthday, you should consider it an opportunity to shop around for cheaper car insurance rates. Below shows the relationship between car insurance and your age.

Age

Age Group 6-month Premium Monthly Premium
16-19 $2,608 $435
20-29 $989 $165
30-39 $724 $121
40-49 $698 $116
50-59 $648 $108
60-69 $662 $110
70-79 $778 $130
80-85 $923 $154

Driving Record

Driving Record

Getting any type of violation even a minor one can have major impacts on your premium. For an at-fault accident, the average rate increase in 2018 was $309 per six-month policy or $618 per year. Most insurance providers will raise rates for three to five years after any violation, ticket, or claim.

Credit Score

In all but a handful of states, your credit score is a major rating factor. According to the Federal Trade Commission, drivers with low credit not only file more claims than drivers with high credit but their claims tend to be more expensive.

Credit Level 6-Month Premium Monthly Premium
Very Poor (300-579) $1,364 $227
Fair (580-669) $1,120 $187
Good (670-739) $920 $153
Very Good (740-799) $769 $128
Exceptional (800-850) $654 $109

Vehicle

It goes without saying: your vehicle contributes to the cost of your car insurance. Every single vehicle will generate a unique premium based on its vehicle identification number (VIN). Insurance companies use the VIN to assess your vehicle’s mileage, accident history, and other characteristics that are factored into your premium.

Vehicle Type 6-Month Premium
Truck $810
Van $829
SUV $901
Car $1,058
Luxury $976
Green $1,008

How to Save Money on Car Insurance

How to Save Money on Car Insurance

Most car insurer’s carriers provide many avenues for scoring discounts on your annual insurance premium. Popular ways to save money with car insurance discounts include:

  • Safe Driver Discounts: Most car insurance providers offer safe driver discounts for drivers who have completed an eligible safety course within the past couple of years.
  • Multi-car discounts: If your household has multiple vehicles, consider placing them all on one insurance policy to qualify for multi-car discounts.
  • Bundling insurance policies: You can often score better insurance premiums overall when you bundle your car insurance policy with a life or renter’s insurance policy.
  • Good student discounts: Many insurance carriers offer discounts for young drivers with good grades in school. For example, Nationwide extends its good student discount to those drivers aged 16-24 enrolled full-time in high school or college who sustain a B average. You’ll just need to provide academic evidence in the form of an up-to-date grade report or a form signed by a school administrator.
  • Paying the annual lump sum: Many insurance companies provide a discount for those drivers willing to pay upfront because it is more convenient and requires less processing for them.

Summary

Car insurance is designed and priced to suit each individual, accurately estimating the risk they represent to an insurer. While car insurance quote pricing varies by driver, it also varies by company. Between the cheapest company and the most expensive, you might find a substantial price gap.

Take the national average cost of car insurance with a grain of salt. To find an affordable policy, consult an insurance agent or compare as many companies as possible online.

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